Post Earnings Coverage as Boeing's Net Earnings Jumped 19%; Operating Cash Flow Soared 64%
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Upcoming AWS Coverage on Huntington Ingalls Industries Post-Earnings Results
LONDON, UK / ACCESSWIRE / May 1, 2017 / Active Wall St. announces its post-earnings coverage on The Boeing Co. (NYSE: BA). The Company posted its first quarter fiscal 2017 results on April 26, 2017. The aerospace Company surpassed earnings expectations and also increased its earnings forecasts for the year. Register with us now for your free membership at:
One of The Boeing's competitors within the Aerospace/Defense Products & Services space, Huntington Ingalls Industries, Inc. (NYSE: HII), announced on April 06, 2017, that it will release its Q1 2017 financial results on Thursday, May 04, 2017, and host an earnings conference call at 9 a.m. ET the same day. AWS will be initiating a research report on Huntington Ingalls Industries in the coming days.
Today, AWS is promoting its earnings coverage on BA; touching on HII. Get our free coverage by signing up to:
For the three months ended March 31, 2017, Boeing reported revenue of $20.98, down compared to revenue of $22.63 billion from the prior year's same period, which was slightly below analysts' consensus of $21.3 billion.
For Q1 2017, Boeing reported net income of $1.45 billion, or $2.34 a share, up from $1.22 billion, or $1.83 per share, in Q1 2016. On an adjusted basis, the Company posted earnings of $2.01 per share, ahead of the Wall street's estimates of $1.91 per share.
Segment Results
For Q1 2017, Boeing's Commercial Airplanes' revenue was $14.3 billion down 1% on a y-o-y basis, on services growth, offset by lower planned 737 deliveries. The segment's operating margin increased 130 basis points to 8.5%, reflecting improved performance on production and services programs, cost growth on the initial production of KC-46 Tanker aircraft, and less favorable delivery mix.
During the reported quarter, Boeing successfully completed first flight of the 787-10 Dreamliner. The 737 program rolled out the first 737 MAX 9 and received FAA certification for the 737 MAX 8. The Company has reported strong demand for the 737 MAX with more than 3,700 orders since launch. Commercial Airplanes booked 198 net orders during Q1 2017. The segment's Backlog remains robust with more than 5,700 airplanes valued at $417 billion.
During Q1 2017, Boeing's Defense, Space & Security division's revenue totaled $6.5 billion down 18% on a y-o-y basis. The segment's operating margin increased 100 basis points to 11.3%, reflecting improved performance at Boeing Military Aircraft (BMA). The BMA's reported quarter revenue was $2.6 billion down 28% compared to the year ago comparable period, reflecting lower planned deliveries, and operating margin increased to 12.2% on improved performance. During Q1 2017, BMA was awarded a contract for 268 AH-64E Apache helicopters from the US Army, a contract for 17 P-8A Poseidon aircraft from the US Navy, Royal Australian Air Force, and the U.K. Royal Air Force, and a contract from the US Air Force for an additional 15 KC-46 Tanker aircraft.
Boeing's Network & Space Systems' (N&SS) revenue was $1.56 billion for Q1 2017, reflecting lower volume on Commercial Crew. The segment's operating margin was 6.3% driven by lower satellite services volume and investments in development efforts. During the reported quarter, N&SS announced an order for a 702 satellite with a dual payload from SKY Perfect JSAT and Kacific.
For Q1 2017, Boeing's Global Services & Support (GS&S) revenue was $2.33 billion, reflecting timing of contracts. The division's operating margin increased to 13.6% largely reflecting improved performance. During the reported quarter, GS&S was awarded a contract from the Republic of Korea Air Force to continue long-term sustainment of F-15 aircraft over the next five years. Backlog at Defense, Space & Security was $63 billion for Q1 2017, of which 34% represents orders from international customers.
Balance Sheet and Cash Flow
As of March 31, 2017, Boeing's cash and investments in marketable securities totaled $9.2 billion, down from $10.0 billion at the beginning of the quarter. Debt was $10.8 billion, up from the beginning of the quarter, primarily due to the issuance of new debt. Boeing's operating cash flow of $2.1 billion in Q1 2017 was driven by solid operating performance and timing of receipts and expenditures. During the reported quarter, the Company repurchased 14.9 million shares for $2.5 billion; leaving $11.5 billion remaining under the current repurchase authorization which is expected to be completed over approximately the next two years. Total Company backlog at quarter-end was $480 billion, up from $473 billion at the beginning of the quarter, and included net orders for the quarter of $27 billion.
At quarter-end, Boeing Capital's net portfolio balance was $4.0 billion. Total pension expense for Q1 2017 was $334 million, down from $629 million in the same period of the prior year.
Outlook
For FY17, Boeing increased its adjusted earnings per share forecast range to $9.20–$9.40, up from the earlier announced range of $9.10–$9.30. The Company is projecting GAAP earnings in the band of $10.35–$10.55 per share compared with the prior range of $10.25–$10.45. Boeing re-affirmed its FY17 revenues forecast in the range of $90.5 billion−$92.5 billion.
Stock Performance
On Friday, April 28, 2017, the stock closed the trading session at $184.83, slightly climbing 0.88% from its previous closing price of $183.22. A total volume of 2.17 million shares have exchanged hands. Boeing's stock price surged 11.16% in the last three months, 29.07% in the past six months, and 41.66% in the previous twelve months. Furthermore, since the start of the year, shares of the Company have gained 19.75%. The stock is trading at a PE ratio of 22.64 and has a dividend yield of 3.07%.
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